From one of the world's leading economists, a bestselling expose of the state's crucial role in sparking innovation and growth-and the dangers of ignoring this truthConventional wisdom holds that innovation is the preserve of the private sector, best left in the hands of that modern day folk hero-the lone entrepreneur. In this popular tale, the role of the public sector is simply to get out of the way, at best fixing market failures, in order to facilitate our daring hero's bold, risk-taking endeavours. But what if this powerful, contemporary myth is wrong?

In this sharp and controversial expose, Mariana Mazzucato comprehensively debunks the myth of a lumbering, bureaucratic state weighing down a dynamic private sector, to reveal how public investments have been behind many of the greatest innovations of our time. From the technologies that make the iPhone 'smart', to biotech, pharmaceuticals and today's emerging green technologies, it is the state that has been the investor of first resort, our boldest and most valuable innovator. Meanwhile, the private sector only finds the courage to invest after the entrepreneurial state has made the truly pioneering, high-risk investments.

This false narrative has real world consequences - a select few get credit for what is an intensely collective effort, privatising rewards reaped from socialized risks. Mazzucato makes a powerful case that a failure to understand the state's entrepreneurial role is leading us down the wrong path-towards a future of stagnant growth and increased inequality.

As we face the new challenges of the twenty-first century, Mazzucato argues that we need to reinvent the entrepreneurial state, to co-create the opportunities of the future -- and the kinds of public-private deals that will allow smart, innovation-led growth to also be more inclusive growth.

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Review

"Conventional economics offers abstract models; conventional wisdom insists that the answer lies with private entrepreneurship. In this brilliant book, Mariana Mazzucato argues that the former is useless and the latter incomplete."--Martin Wolf, Financial Times

"Mazzucato argues that long-term, patient government funding is an absolute prerequisite for breakthrough innovation.Even if you disagree with Mazzucato's argument, you should read her book. It will challenge your thinking."--Bruce Upbin, Forbes

"It is one of the most incisive economic books in years."--Jeffery Madrick, New York Review of Books

"Ms. Mazzucato is right to argue that the state has played a central role in producing game-changing breakthroughs, and that its contribution to the success of technology-based businesses should not be underestimated."--The Economist

"Provides persuasive evidence that governments deserve more credit than private companies for the development of most important modern technologies."--Edward Hadas, Reuters

"A skillful combination of the history of technology, empirical evidence, and policy analysis--the book contains a critical reading of data and arguments that run counter to established views while never falling short of offering constructive solutions."--Davide Consoli, Science

"Makes an engaging, persuasive case in favor of the state, and suggests one recommend it not just as an instrument of market repair but also as a prerequisite for future prosperity."--J. Bhattacharya, Choice

"In this trailblazing book on the role of government as both a risk-taking funder of innovation and a market creator, Mariana Mazzucato persuasively argues that the government is a key enabler of technological innovations that drive economic growth. This important book should be read by policymakers, opinion leaders, and others with a stake in funding economic growth."--Arnold T. Davis, CFA Institute

Book Description

*A Financial Times, Forbes and Huffington Post Book of the Year *Already a bestseller in UK-The Entrepreneurial State's powerful argument debunks long-held beliefs to reveal how the United States Governments is not the slow, bureaucratic behemoth it appears, but is in fact, one of our most exciting risk-takers-crucial to inciting the growth of innovative business, historically and today.

Most helpful customer reviews on Amazon.com

I'm writing this the day after the third Republican presidential debate. I doubt any of the candidates read The Entrepreneurial State, but they should have.

This book debunks plenty of myths, most notably that keeping government "out" of the economy is the best way to stimulate growth in three key ways.

First, it demonstrates the ways in which national governments have contributed to the success of today's iconic companies, including my beloved Apple.

Second, it shows that far from "picking winners" improperly as politicians claim, public/private partnerships provide leadership for key sectors of the economy, whether that be national security (where it has been most pronounced) to environmental security (where it is arguably most needed).

Third, it makes the case for an economy based on partnerships in which the state and the private sector share both the risks and the rewards for economic innovation.

I would have liked the book to go even farther and look at the role such partnerships could/should play in an interdependent networked economic system, but it does enough to warrant a read by just about anyone interested in social change, including a peacebuilder like me.

The importance of the public sector as a key player in an innovative ecosystem is not often acknowledged nor well understood. In a brilliant book, the author has made the case for the public sector role persuasively. In a world that glorifies individual entrepreneurs and venture capitalists as the risk takers who drive the innovative economies, readers of this book will be led to realize that it is quite often the public sector investors who have been the true risk takers with respect to the innovations that have made the most impact on society. Another key insight provided is that when the rewards for innovation and risk taking are disproportionately allocated to those whose risks are relatively modest (i.e. venture capital) this creates an innovation system that increases inequality and is less sustainable than one which rewards risk takers (public and private) more fairly. Unless the public sector can reap rewards that recognize its role in the creation and regulation of new markets, the innovation system will be less likely to create major breakthroughs like the internet, nanotechnology, etc. The clear message of this book is that a true innovation system that is sustainable and that will create transformational change requires the full participation of the private sector and the public sector working together to do what each does best.

5.0 out of 5 starsOne of the most important books ever - Especially now!

25 February 2019 - Published on Amazon.com

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I first learned about this book when I heard an hourlong podcast where Mariana Mazzucato, the author, is interviewed by Stella Creasy who is a London School of Economics trained Labour Party member of parliament, about Mazzucato's research findings and policy proposals.Lately, we have been hearing some bold proposals about a Green New Deal. Many have dismissed this idea as pie in the sky. Some have supported it as crucially necessary to the survival of the planet, but have been vague as to how to actually bring this about. Well, Mariana Mazzucato, Chair in the Economics of Innovation and Public Value, and Director of the Institute for Innovation and Public Purpose at University College, London, addressed this very issue in her 2015 book, "The Entrepreneurial State." She points out that our current economy is built around fossil fuels, and that to address climate change will require a large restructuring of our basic economy. This will include building new Public-Private partnerships, and innovation that will create new jobs, new security and repair infrastructure. To accomplish this, we first have to let go of false myths we hold about the responsibility as well as the competence of the state. Mazzucato does a superb job of debunking those myths in this book. While parts of the book are fairly dense, even a non-economist like me can understand most of her points. This is a must read by anyone interested in saving the planet and by all policy makers.

In this book, Mazzucato makes the argument that the state is the best actor to be the one to make long-range investments in technology, as private actors under capitalism are too focused on short term rewards to really be able to focus on real blue ocean development.

In fact, she argues, some of the more celebrated examples of private innovation can be linked to research and investment the state has made. This process of celebrating the private corporation has a way of erasing what the state has done and allows political rhetoric to attack research the state does. Her best example in the book is the Apple iPhone, where she looks at the basic research from the internet to mobile telephony to interface design that goes back to work governments did starting thirty or more years ago. I think as a reader that this example is strong enough to support her basic argument, but she also continues in the book to look at solar power as another example. Because this isn’t as widespread as the iPhone and its clones, it feels like a weaker example, even if down the road it will be more prevalent than the iPhone.

Well written and I learned quite a few things. Large corporations are getting free R & D from US government, and paying very little in the way of taxes. That means taxpayers are subsidizing them. In the 50's that was OK because US Corporations were in the 90% tax bracket. At the time I though a 90% tax bracket to be excessive. At the time I couldn't figure out how they were doing so well while they were paying so much in taxes. Now I know it was because tax payers were paying for the development of new products, and in some cases drugs. Since their tax bracket was so high, it seems fair that the government did so much for them, but now the highest tax bracket is 35% and most company pay only 16% at most..